Correlation Between PARKEN Sport and Kemper
Can any of the company-specific risk be diversified away by investing in both PARKEN Sport and Kemper at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining PARKEN Sport and Kemper into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between PARKEN Sport Entertainment and Kemper, you can compare the effects of market volatilities on PARKEN Sport and Kemper and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in PARKEN Sport with a short position of Kemper. Check out your portfolio center. Please also check ongoing floating volatility patterns of PARKEN Sport and Kemper.
Diversification Opportunities for PARKEN Sport and Kemper
-0.15 | Correlation Coefficient |
Good diversification
The 3 months correlation between PARKEN and Kemper is -0.15. Overlapping area represents the amount of risk that can be diversified away by holding PARKEN Sport Entertainment and Kemper in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kemper and PARKEN Sport is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on PARKEN Sport Entertainment are associated (or correlated) with Kemper. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kemper has no effect on the direction of PARKEN Sport i.e., PARKEN Sport and Kemper go up and down completely randomly.
Pair Corralation between PARKEN Sport and Kemper
Assuming the 90 days horizon PARKEN Sport Entertainment is expected to generate 1.49 times more return on investment than Kemper. However, PARKEN Sport is 1.49 times more volatile than Kemper. It trades about 0.05 of its potential returns per unit of risk. Kemper is currently generating about 0.05 per unit of risk. If you would invest 1,715 in PARKEN Sport Entertainment on November 3, 2024 and sell it today you would earn a total of 40.00 from holding PARKEN Sport Entertainment or generate 2.33% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
PARKEN Sport Entertainment vs. Kemper
Performance |
| Timeline |
| PARKEN Sport Enterta |
| Kemper |
PARKEN Sport and Kemper Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with PARKEN Sport and Kemper
The main advantage of trading using opposite PARKEN Sport and Kemper positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PARKEN Sport position performs unexpectedly, Kemper can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in Kemper will offset losses from the drop in Kemper's long position.| PARKEN Sport vs. SANOK RUBBER ZY | PARKEN Sport vs. Plastic Omnium | PARKEN Sport vs. FIREWEED METALS P | PARKEN Sport vs. Martin Marietta Materials |
| Kemper vs. Tokio Marine Holdings | Kemper vs. The Peoples Insurance | Kemper vs. W R Berkley | Kemper vs. Loews Corp |
Check out your portfolio center.Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the Equity Valuation module to check real value of public entities based on technical and fundamental data.
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